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EXHIBIT 10-27
SEVERANCE PROTECTION AGREEMENT
SEVERANCE PROTECTION AGREEMENT dated (AGDATE) ,
by and between General Dynamics Corporation, a Delaware corporation (the
"Company"), and (INIT) (SNAME) (the "Executive").
The Board of Directors of the Company (the
"Board") recognizes that the possibility of a Change in Control (as hereinafter
defined) of the Company exists and that the threat or occurrence of a Change in
Control may result in the distraction of its key management personnel because
of the uncertainties inherent in such a situation.
The Board has determined that it is essential and
in the best interests of the Company and its stockholders to retain the
services of the Executive in the event of the threat or occurrence of a Change
in Control and to ensure the Executive's continued dedication and efforts in
such event without undue concern for the Executive's personal financial and
employment security.
In order to induce the Executive to remain in the
employ of the Company, particularly in the event of the threat or occurrence of
a Change in Control, the Company desires to enter into this Agreement to
provide the Executive with certain benefits in the event the Executive's
employment is terminated as a result of, or in connection with, a Change in
Control.
NOW, THEREFORE, in consideration of the respective
agreements of the parties contained herein, it is agreed as follows:
Section 1. Definitions. For purposes of
this Agreement, the following terms have the meanings set forth below:
"Accounting Firm" has the meaning set forth in
Section 5.2.
"Accrued Compensation" means an amount which
includes all amounts earned or accrued by the Executive through and including
the Termination Date but not paid to the Executive on or prior to such date,
including (a) all base salary, (b) reimbursement for all reasonable and
necessary expenses incurred by the Executive on behalf of the Company during
the period ending on the Termination Date, (c) all vacation pay and (d) all
bonuses and incentive compensation (other than the Pro Rata Bonus).
"Base Amount" means the greater of the Executive's
annual base salary (a) at the rate in effect on the Termination Date and (b) at
the highest rate in effect at any time during the 180-day period prior to a
Change in Control, and will include all amounts of the Executive's base salary
that are deferred under any qualified or non-qualified employee benefit plan of
the Company or any other agreement or arrangement.
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"Beneficial Owner" has the meaning as used in Rule
13d-3 promulgated under the Securities Exchange Act. The term "Beneficially
Owned" has a correlative meaning.
"Board" means the Board of Directors of the
Company.
"Bonus Amount" means the most recent annual bonus,
excluding the Pro Rata Bonus, paid or payable to the Executive.
"Cause" for the termination of the Executive's
employment with the Company will be deemed to exist if the Executive has been
convicted of a felony or if the Board determines by a resolution adopted in
good faith by at least two-thirds of the Board that the Executive has (a)
intentionally and continually failed to perform in all material respects the
Executive's reasonably assigned duties with the Company (other than a failure
resulting from the Executive's incapacity due to physical or mental disability
or illness or from the Executive's assignment of duties that would constitute
Good Reason for the Executive's termination of employment with the Company)
which failure has continued for a period of at least 30 days after a written
notice of demand for performance has been delivered to the Executive specifying
the manner in which the Executive has failed in all material respects to so
perform or (b) intentionally engaged in conduct which is demonstrably and
materially injurious to the Company; provided that no termination of the
Executive's employment will be for Cause as set forth in clause (b) hereof
unless (i) there has been delivered to the Executive a written notice
specifying in reasonable detail the conduct of the Executive of the type
described in clause (b) and (ii) the Executive has been provided an opportunity
to be heard in person by the Board (with the assistance of the Executive's
counsel if the Executive so desires). No act, nor failure to act, on the
Executive's part will be considered intentional unless the Executive has acted,
or failed to act, with a lack of good faith and with a lack of reasonable
belief that the Executive's action or failure to act was in or not opposed to
the best interests of the Company.
"Change in Control" means any following events:
(a) An acquisition (other than
directly from the Company) of any voting
securities of the Company by any Person who on the
date of this Agreement is the Beneficial Owner of
less than 10% of the combined voting power of the
Company's outstanding voting securities and who
immediately after such acquisition is the
Beneficial Owner of 30% or more of the combined
voting power of the Company's then outstanding
voting securities; provided that in determining
whether a Change in Control has occurred, voting
securities which are acquired by (i) an employee
benefit plan (or a trust forming a part thereof)
maintained by the Company or any Subsidiary of the
Company, (ii) the Company or any Subsidiary of the
Company or (iii) any Person in connection with a
Non-Control Transaction
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(as hereinafter defined), will not constitute an
acquisition which results in a Change in Control;
(b) Approval by stockholders of the
Company of:
(i) a merger, consolidation or
reorganization involving the Company,
unless:
(A) the stockholders of
the Company immediately before such
merger, consolidation or reorganization
will own, directly or indirectly,
immediately following such merger,
consolidation or reorganization, at
least 51% of the combined voting power
of the outstanding voting securities of
the corporation resulting from such
merger, consolidation or reorganization
(the "Surviving Corporation") in
substantially the same proportion as
their ownership of the voting
securities of the Company immediately
before such merger, consolidation or
reorganization;
(B) the individuals who were
members of the Board
immediately prior to the execution of
the agreement providing for such
merger, consolidation or reorganization
constitute a majority of the members of
the board of directors of the Surviving
Corporation; and
(C) no Person (other than the
Company, any Subsidiary of the
Company, any employee benefit plan (or
any trust forming a part thereof)
maintained by the Company, the
Surviving Corporation, any Subsidiary
of the Surviving Corporation, or any
Person who, immediately prior to such
merger, consolidation or
reorganization, was the Beneficial
Owner of 20% or more of the then
outstanding voting securities of the
Company) is the Beneficial Owner of 20%
or more of the combined voting power of
the Surviving Corporation's then
outstanding voting securities.
(D) a transaction described
in clauses (A) through (C)
above is referred to herein as a
"Non-Control Transaction";
(ii) the complete liquidation or
dissolution of the Company; or
(iii) an agreement for sale or other
disposition of all or substantially all of
the assets of the Company to any Person
(other than a transfer to a Subsidiary of
the Company).
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(c) Notwithstanding the foregoing, a
Change in Control will not be deemed to occur
solely because any Person (a "Subject Person")
acquires Beneficial Ownership of more than the
permitted amount of the outstanding voting
securities of the Company as a result of the
acquisition of voting securities by the Company
which, by reducing the number of voting securities
outstanding, increases the proportional number of
shares Beneficially Owned by the Subject Person,
provided that if a Change in Control would occur
(but for the operation of this sentence) as a
result of the acquisition of voting securities by
the Company, and after such share acquisition by
the Company, the Subject Person becomes the
Beneficial Owner of any additional voting
securities which increases the percentage of the
then outstanding voting securities Beneficially
Owned by the Subject Person, then a Change in
Control will be deemed to have occurred.
(d) Notwithstanding anything
contained in this Agreement to the contrary, if
the Executive's employment with the Company is
terminated prior to a Change in Control and the
Executive reasonably demonstrates that such
termination (i) was at the request of a Person
who has indicated an intention or taken steps
reasonably calculated to effect a Change in
Control and who subsequently effects a Change in
Control or (ii) otherwise occurred in connection
with, or in anticipation of, a Change in Control
which subsequently occurs, then for all purposes
of this Agreement, the date of such Change in
Control with respect to the Executive will mean
the date immediately prior to the date of such
termination of the Executive's employment.
"Code" means the Internal Revenue Code of
1986, as amended.
"Company" means General Dynamics
Corporation, a Delaware corporation, and includes
its Successors.
"Continuation Period" has the meaning set
forth in Section 3.1(b)(iii).
"Determination" has the meaning set forth
in Section 5.2.
"Disability" means a physical or mental
disability or illness which substantially impairs
the Executive's ability to perform the Executive's
regular duties with the Company for a period of
180 consecutive days or for a period of 270 days
in any 365-day period.
"Dispute" has the meaning set forth in
Section 5.2.
"Excess Payment" has the meaning set forth
in Section 5.3.
"Excise Tax" has the meaning set forth in
Section 5.1. "Final Determination" has the
meaning set forth in Section 5.3.
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"Good Reason" means the occurrence after a
Change in Control of any of the events or
conditions described in clauses (a) through (h)
hereof:
(a) any (i) change in the Executive's
status, title, position or responsibilities
(including reporting responsibilities) which, in
the Executive's reasonable judgment, represents an
adverse change from the Executive's status,
title, position or responsibilities as in effect
at any time within 180 days preceding the date of
the Change in Control or at any time thereafter,
(ii) assignment to the Executive of duties or
responsibilities which, in the Executive's
reasonable judgment, are inconsistent with the
Executive's status, title, position or
responsibilities as in effect at any time within
180 days preceding the date of the Change in
Control or at any time thereafter, or (iii)
removal of the Executive from or failure to
reappoint or reelect the Executive to any of such
offices or positions, in each case except in
connection with the termination of the Executive's
employment for Disability, Cause, as a result of
the Executive's death or by the Executive other
than for Good Reason;
(b) a reduction in the Executive's
base salary or any failure to pay the Executive
any compensation or benefits to which the
Executive is entitled within five days after the
date when due;
(c) the imposition of a requirement
that the Executive be based at any place outside a
50-mile radius from (LOCATION) , except for
reasonably required travel on Company business
which is not materially greater in frequency or
duration than prior to the Change in Control;
(d) the failure by the Company to (i)
continue in effect (without reduction in benefit
level or reward opportunities and without
unreasonably establishing or modifying any
performance or other criteria used to determine
reward levels) any material compensation or
employee benefit plan in which the Executive was
participating at any time within 180 days
preceding the date of the Change in Control or at
any time thereafter, unless such plan is replaced
with a plan that provides substantially equivalent
compensation or benefits to the Executive or (ii)
provide the Executive with compensation and
benefits, in the aggregate, at least equal (in
terms of benefit levels and reward opportunities)
to those provided for under each other employee
benefit plan, program and practice in which the
Executive was participating at any time within 180
days preceding the date of the Change in Control
or at any time thereafter;
(e) the insolvency or the filing (by
any party, including the Company) of a petition
for bankruptcy with respect to the Company, which
petition is not dismissed within 60 days;
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(f) any material breach by the
Company of any provision of this Agreement;
(g) any purported termination of the
Executive's employment for Cause by the Company
which does not comply with the terms of this
Agreement; or
(h) the failure of the Company to
obtain, as contemplated in Section 6, an
agreement, reasonably satisfactory to the
Executive, from any Successor to assume and agree
to perform this Agreement.
Any event or condition described in clauses (a)
through (h) which occurs prior to a Change in Control but which the Executive
reasonably demonstrates (a) was at the request of a Person who has indicated
the intention or takes steps reasonably calculated to affect a Change in
Control and who subsequently effects a Change in Control or (b) otherwise arose
in connection with, or in anticipation of, a Change in Control which
subsequently occurs, will constitute Good Reason for purposes of this Agreement
notwithstanding that it occurred prior to the Change in Control.
"Gross-Up Payment" has the meaning set forth in
Section 5.1.
"Notice of Termination" means a written notice
from the Company of the termination of the Executive's employment which
indicates the specific termination provision in this Agreement relied upon and
which sets forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive's employment under the
provision so indicated.
"Person" has the meaning as used in Section 13(d)
or 14(d) of the Securities Exchange Act, and will include any "group" as such
term is used in such sections.
"Pro Rata Bonus" means an amount equal to the
Bonus Amount multiplied by a fraction, the numerator of which is the number of
days elapsed in the then fiscal year through and including the Termination Date
and the denominator of which is 365.
"Securities Exchange Act" means the Securities
Exchange Act of 1934, as amended.
"Subsidiary" means any corporation with respect to
which another specified corporation has the power under ordinary circumstances
to vote or direct the voting of sufficient securities to elect a majority of
the directors.
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"Successor" means a corporation or other entity
acquiring all or substantially all the assets and business of the Company,
whether by operation of law, by assignment or otherwise.
"Supplemental Retirement Benefit" will mean the
lump sum actuarial equivalent of the aggregate retirement benefit the Executive
would have been entitled to receive under the Company's supplemental and other
retirement plans, including the General Dynamics Corporation Retirement Plan
for Salaried Employees (the "Pension Plan"). For purposes of the foregoing,
the "actuarial equivalent" will be determined in accordance with the actuarial
assumptions used for the calculation of benefits under the Pension Plan as
applied immediately prior to the Termination Date in accordance with past
practices.
"Termination Date" means (a) in the case of the
Executive's death, the Executive's date of death, (b) in the case of the
termination of the Executive's employment with the Company by the Executive for
Good Reason, the last day of the Executive's employment, and (c) in all other
cases, the date specified in the Notice of Termination; provided that if the
Executive's employment is terminated by the Company for Cause or due to
Disability, the date specified in the Notice of Termination will be at least 30
days after the date the Notice of Termination is given to the Executive.
"Underpayment" has the meaning set forth in
Section 5.3.
"Window Period" has the meaning set forth in
Section 3.1(a).
Section 2. Term of Agreement. This
Agreement will commence as of (AGDATE) , and will continue in effect until
(EXPDATE) ; provided that in the event a Change in Control occurs prior to
(EXPDATE) , the term of this Agreement will be extended to the date 24
months after the date of the occurrence of such Change in Control.
Section 3. Termination of Employment.
3.1. If, during the term of this
Agreement, the Executive's employment with the Company is terminated within 24
months following a Change in Control, the Executive will be entitled to the
following compensation and benefits:
(a) If the Executive's employment
with the Company is terminated (i) by the Company
for Cause or Disability, (ii) by reason of the
Executive's death or (iii) by the Executive other
than for Good Reason and other than during the
60-day period commencing on the first anniversary
of the date of the occurrence of a Change in
Control (the "Window Period"), the Company will
pay to the Executive the Accrued Compensation
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and, if such termination is other than by the
Company for Cause, a Pro Rata Bonus.
(b) If the Executive's employment
with the Company is terminated for any reason
other than as specified Section 3.1(a) or during
the Window Period, the Executive will be entitled
to the following:
(i) the Company will pay the
Executive all Accrued Compensation and a
Pro Rata Bonus;
(ii) the Company will pay the
Executive as severance pay, and in lieu of
any further compensation for periods
subsequent to the Termination Date, in a
single payment an amount in cash equal to
(MULTI) times the sum of (A) the Base
Amount and (B) the Bonus Amount;
(iii) for a period of (CMONTHS)
months (the "Continuation Period"), the
Company will at its expense continue on
behalf of the Executive and the Executive's
dependents and beneficiaries the life
insurance, disability, medical, dental and
hospitalization benefits provided (A) to
the Executive at any time during the
180-day period prior to the Change in
Control or at any time thereafter or (B)
to other similarly situated executives who
continue in the employ of the Company
during the Continuation Period. The
coverage and benefits (including
deductibles and costs) provided in this
Section 3.1(b)(iii) during the
Continuation Period will be no less
favorable to the Executive and the
Executive's dependents and beneficiaries
than the most favorable of such coverages
and benefits during any of the periods
referred to in clauses (A) and (B) above.
The Company's obligation hereunder with
respect to the foregoing benefits will be
limited to the extent that the Executive
obtains any such benefits pursuant to a
subsequent employer's benefit plans, in
which case the Company may reduce the
coverage of any benefits it is required to
provide the Executive hereunder as long as
the coverages and benefits of the combined
benefit plans are no less favorable to the
Executive than the coverages and benefits
required to be provided hereunder. This
Section 3.1(b) will not be interpreted so
as to limit any benefits to which the
Executive or the Executive's dependents or
beneficiaries may be entitled under any of
the Company's employee benefit plans,
programs or practices following the
Executive's termination of employment,
including retiree medical and life
insurance benefits;
(iv) the Company will pay in a single
payment an amount in cash equal to the
excess of (A) the Supplemental Retirement
Benefit determined as if (1) the Executive
had remained employed by the
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Company for an additional (SYRS)
year(s) of credited service, (2) the
Executive's annual compensation during
such period had been equal to the
Executive's Base Salary and the Bonus
Amount and (3) the Executive had been
fully vested in the Executive's benefit
under each retirement plan in which the
Executive was a participant, over (B) the
lump sum actuarial equivalent of the
aggregate retirement benefit the Executive
is actually entitled to receive under such
retirement plans; and
(v) any restrictions on any
outstanding restricted stock awards
granted to the Executive will lapse and
such restricted stock awards will become
fully vested, all in-the-money stock
options will become fully vested, and the
Executive will have the right to require
the Company to purchase, for cash, any
out-of-the-money stock options held by the
Executive at a price equal to the fair
market value of such options on the date
of purchase determined by the Company
using the Black-Scholes option pricing
model. For purposes of this Section
3.1(b)(v), a stock option will be deemed
(A) to be in-the-money if, as of the date
of determination, the New York Stock
Exchange composite quotation for the
Company's Common Stock, as reported in the
Wall Street Journal, as of the close of
business, New York City time, on the
immediately preceding trading day (the
"Applicable Price"), exceeds the exercise
price per share required to be paid by the
holder upon the exercise of such option
and (B) to be out-of-the-money if, as of
the date of determination, the Applicable
Price is equal to or less than such
exercise price.
(c) The amounts provided for in
Section 3.1(a) and Sections 3.1(b)(i), (ii) and
(iv) will be paid in a single lump sum cash
payment by the Company to the Executive within
five days after the Termination Date.
(d) The Executive will not be
required to mitigate the amount of any payment
provided for in this Agreement by seeking other
employment or otherwise, and no such payment will
be offset or reduced by the amount of any
compensation or benefits provided to the Executive
in any subsequent employment except as
specifically provided in Section 3.1(b)(iii).
3.2. The compensation to be paid to
the Executive pursuant to Sections 3.1(a), 3.1(b)(i) and 3.1(b)(ii) of this
Agreement will be in lieu of any similar severance or termination compensation
(i.e., compensation based directly on the Executive's annual salary or annual
salary and bonus) to which the Executive may be entitled under any other
Company severance or termination agreement, plan, program, policy, practice or
arrangement. With respect to any other compensation and benefit to be paid or
provided to the Executive pursuant to this Section 3, the Executive will have
the right to receive such compensation
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or benefit as herein provided or, if determined by the Company to be more
advantageous to the Executive, similar compensation or benefits to which the
Executive may be entitled under any other Company severance or termination
agreement, plan, program, policy, practice or arrangement. The Executive's
entitlement to any compensation or benefits of a type not provided in this
Agreement will be determined in accordance with the Company's employee benefit
plans and other applicable programs, policies and practices as in effect from
time to time.
Section 4. Notice of Termination. Following
a Change in Control, any purported termination of the Executive's employment by
the Company will be communicated by a Notice of Termination to the Executive.
For purposes of this Agreement, no such purported termination will be effective
without such Notice of Termination.
Section 5. Excise Tax Payments.
5.1. In the event that any payment or
benefit (within the meaning of Section 280G(b)(2) of the Code) to the Executive
or for the Executive's benefit paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise in connection with, or
arising out of, the Executive's employment with the Company or a change in
ownership or effective control of the Company or of a substantial portion of
its assets (a "Payment"), would be subject to the excise tax imposed by Section
4999 of the Code, or any interest or penalties are incurred by the Executive
with respect to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to herein as the
"Excise Tax"), then the Executive will be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with
respect to such taxes and the Excise Tax, other than interest and penalties
imposed by reason of the Executive's failure to file timely a tax return or pay
taxes shown due on the Executive's return, and including any Excise Tax imposed
upon the Gross-Up Payment), the Executive retains an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Payments.
5.2. An initial determination as to
whether a Gross-Up Payment is required pursuant to this Agreement and the
amount of such Gross-Up Payment will be made at the Company's expense by an
accounting firm of recognized national standing selected by the Company and
reasonably acceptable to the Executive (the "Accounting Firm"). The Accounting
Firm will provide its determination (the "Determination"), together with
detailed supporting calculations and documentation, to the Company and the
Executive within five days of the Termination Date, if applicable, or such
other time as requested by the Company or by the Executive (provided the
Executive reasonably believes that any of the Payments may be subject to the
Excise Tax). If the Accounting Firm determines
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that no Excise Tax is payable by the Executive with respect to a Payment or
Payments, it will furnish the Executive with an opinion reasonably acceptable
to the Executive that no Excise Tax will be imposed with respect to any such
Payment or Payments. Within ten days of the delivery of the Determination to
the Executive, the Executive will have the right to dispute the Determination
(the "Dispute"). The Gross-Up Payment, if any, as determined pursuant to this
Section 5.2 will be paid by the Company to the Executive within five days of
the receipt of the Determination. The existence of the Dispute will not in any
way affect the Executive's right to receive the Gross-Up Payment in accordance
with the Determination. If there is no Dispute, the Determination will be
binding, final and conclusive upon the Company and the Executive, subject to
the application of Section 5.3.
5.3. As a result of uncertainty in the
application of Sections 280G and 4999 of the Code, it is possible that a
Gross-Up Payment (or a portion thereof) will be paid which should not be paid
(an "Excess Payment") or that a Gross-Up Payment (or a portion thereof) which
should be paid will not be paid (an "Underpayment"). An Underpayment will be
deemed to have occurred (a) upon notice (formal or informal) to the Executive
from any governmental taxing authority that the Executive's tax liability
(whether in respect of the Executive's current taxable year or in respect of
any prior taxable year) may be increased by reason of the imposition of the
Excise Tax on a Payment or Payments with respect to which the Company has
failed to make a sufficient Gross-Up Payment, (b) upon a determination by a
court, (c) by reason of a determination by the Company (which will include the
position taken by the Company, together with its consolidated group, on its
federal income tax return) or (d) upon the resolution of the Dispute to the
Executive's satisfaction. If an Underpayment occurs, the Executive will
promptly notify the Company and the Company will promptly, but in any event at
least five days prior to the date on which the applicable government taxing
authority has requested payment, pay to the Executive an additional Gross-Up
Payment equal to the amount of the Underpayment plus any interest and penalties
(other than interest and penalties imposed by reason of the Executive's failure
to file timely a tax return or pay taxes shown due on the Executive's return)
imposed on the Underpayment. An Excess Payment will deemed to have occurred
upon a Final Determination (as hereinafter defined) that the Excise Tax will
not be imposed upon a Payment or Payments (or portion thereof) with respect to
which the Executive had previously received a Gross-Up Payment. A "Final
Determination" will be deemed to have occurred when the Executive has received
from the applicable government taxing authority a refund of taxes or other
reduction in the Executive's tax liability by reason of the Excise Payment and
upon either (i) the date a determination is made by, or an agreement is entered
into with, the applicable governmental taxing authority which finally and
conclusively binds the Executive and such taxing authority, or in the event
that a claim is brought before a court of competent jurisdiction, the date upon
which a final determination has been made by such court and either all appeals
have been taken and finally resolved or the time for all appeals has expired or
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(ii) the statute of limitations with respect to the Executive's applicable tax
return has expired. If an Excess Payment is determined to have been made, the
amount of the Excess Payment will be treated as a loan by the Company to the
Executive and the Executive will pay to the Company on demand (but not less
than 10 days after the determination of such Excess Payment and written notice
has been delivered to the Executive) the amount of the Excess Payment plus
interest at an annual rate equal to the Applicable Federal Rate provided for in
Section 1274(d) of the Code from the date the Gross-Up Payment (to which the
Excess Payment relates) was paid to the Executive until the date of repayment
to the Company. The Executive will use reasonable cooperative efforts at the
request of the Company to assist in the determination of the amount of any
Excess Payment or Underpayment made to the Executive pursuant to this
Agreement.
5.4. Notwithstanding anything
contained in this Agreement to the contrary, in the event that, according to
the Determination, an Excise Tax is imposed on any Payment or Payments, the
Company will pay to the applicable government taxing authorities as Excise Tax
withholding the amount of the Excise Tax that the Company has actually withheld
from the Payment or Payments.
Section 6. Successors; Binding Agreement.
This Agreement will be binding upon and will inure to the benefit of the
Company and its Successors, and the Company will require any Successors to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession or assignment had taken place. Neither this Agreement nor any right
or interest hereunder will be assignable or transferable by the Executive or by
the Executive's beneficiaries or legal representatives, except by will or by
the laws of descent and distribution. This Agreement will inure to the benefit
of and be enforceable by the Executive's legal representatives. (DIVSALE=Y)
In the event that the Division/Subsidiary (or part thereof) is sold, divested or
otherwise disposed of by the Company subsequent to a Change in Control and the
Executive is offered employment by the purchaser or acquiror thereof, the
Company will require such purchaser or acquiror to assume and agree to perform
the Company's obligations under this Agreement, in the same manner and to the
same extent that the Company would be required to perform if no such
acquisition or purchase had taken place.
Section 7. Fees and Expenses. The Company
will pay as they become due all legal fees and related expenses (including the
costs of experts) incurred by the Executive as a result of (a) the Executive's
termination of employment (including all such fees and expenses, if any,
incurred in contesting or disputing any such termination of employment) and (b)
the Executive seeking to obtain or enforce any right or benefit provided by
this Agreement (including any such fees and expenses incurred in connection
with (i) the Dispute and (ii) the Gross-Up Payment, whether as a result of any
applicable government taxing authority proceeding, audit or otherwise) or by
any other plan or arrangement
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maintained by the Company under which the Executive is or may be entitled to
receive benefits.
Section 8. Notice. For the purposes of this
Agreement, notices and all other communications provided for in the Agreement
(including the Notice of Termination) will be in writing and will be deemed to
have been duly given when personally delivered or sent by certified mail,
return receipt requested, postage prepaid, addressed to the respective
addresses last given by each party to the other, provided that all notices to
the Company will be directed to the attention of the Board with a copy to the
Secretary of the Company. All notices and communications will be deemed to
have been received on the date of delivery thereof or on the third business day
after the mailing thereof, except that notice of change of address will be
effective only upon receipt.
Section 9. Nonexclusivity of Rights.
Nothing in this Agreement will prevent or limit the Executive's continuing or
future participate in any benefit, bonus, incentive or other plan or program
provided by the Company (except for any severance or termination policies,
plans, programs or practices) for which the Executive may qualify, nor will
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company (except for any severance or termination
agreement). Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan or program of the Company will be
payable in accordance with such plan or program, except as specifically
modified by this Agreement.
Section 10. No Set-Off. The Company's
obligation to make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder will not be affected by any circumstances,
including any right of set-off, counterclaim, recoupment, defense or other
right which the Company may have against the Executive or others.
Section 11. Miscellaneous. No provision of
this Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by the Executive
and the Company. No waiver by either party hereto at any time of any breach by
the other party hereto of, or compliance with, any condition or provision of
this Agreement to be performed by such other party will be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreement or representations, oral or otherwise, express
or implied, with respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement.
Section 12. Governing Law. This Agreement
will be governed by and construed and enforced in accordance with the laws of
the State of Delaware without giving effect to the conflict of laws principles
thereof. Any action
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brought by any party to this Agreement will be brought and maintained in a
court of competent jurisdiction in New Castle County in the State of Delaware.
Section 13. Severability. The provisions of
this Agreement will be deemed severable and the invalidity or unenforceability
of any provision will not affect the validity or enforceability of the other
provisions hereof.
Section 14. Entire Agreement. This Agreement
constitutes the entire agreement between the parties hereto and supersedes all
prior agreements, if any, understandings and arrangements, oral or written,
between the parties hereto with respect to the subject matter hereof.
* * * * *
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IN WITNESS WHEREOF, the parties have executed and
delivered this Agreement as of the date first above written.
GENERAL DYNAMICS CORPORATION
By:
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Xxxxxx X. Xxxxxxxxxx
Corporate Vice President &
General Counsel
By:
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(INIT) (SNAME)
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